Global oil prices moved down sharply after signals that a possible US Iran agreement could reduce conflict tensions. Market traders reacted quickly to political comments suggesting progress in negotiations.
Brent crude slipped about 5.5 percent to nearly 97.70 dollars per barrel during the trading day.
Market Reaction to Diplomatic Signals
Oil traders responded to comments from US officials suggesting that a draft understanding is on the table. Sentiment shifted as investors expected lower supply risk if tensions ease.
US President Donald Trump said talks are moving forward, but he warned that any final outcome will depend on a complete agreement rather than partial progress.
He also said negotiators should avoid rushing decisions.
Iran Says Agreement Is Not Final
Iranian officials confirmed that discussions have made progress on several issues. At the same time, they stressed that no final agreement is close.
A government spokesperson said the situation remains under negotiation and no one should assume an imminent deal.
US officials also described the process as ongoing and not fully settled.
Strait of Hormuz in Focus
Talks reportedly include discussion about reopening the Strait of Hormuz, a key global oil route.
Around one fifth of global oil and liquefied natural gas shipments pass through this waterway under normal conditions.
The route has faced disruption since the conflict escalated in late February, raising concerns in energy markets.
Political Discussions Continue
US Secretary of State Marco Rubio said negotiators are still working through key issues. He noted that progress exists, but important details remain unresolved.
US officials also shared that communication with regional leaders, including Saudi Arabia, the United Arab Emirates, and Qatar, has taken place as part of wider diplomatic efforts.
Outlook for Oil Markets
Oil prices may stay volatile as traders react to each update from negotiations. Any confirmed agreement could ease supply concerns and push prices lower.
However, without a final deal, uncertainty will likely keep markets sensitive to political statements.
